The article, prominently featured on the cover of the latest edition of The Economist, delivers grim news for the global real estate sector. The text illuminates a critical yet often overlooked consequence of climate change: its profound impact on residential properties worldwide.
The staggering estimated costs of $25 trillion by 2050 underscore the urgent need to grapple with who bears these financial burdens. Homeowners, taxpayers, and insurers are all potential candidates, but the distribution of costs and benefits remains a contentious issue. Insurers, already strained by escalating climate-related claims, face mounting pressure that could destabilize the housing market.
Governments are being pushed to intervene, whether by underwriting risks or investing in protective infrastructure. However, the equitable distribution of costs and benefits, particularly concerning homeowners who may be unaware of their vulnerability, poses significant challenges. Moreover, the imperative to retrofit homes for resilience and emission reduction is paramount. Yet, this endeavor is not without obstacles, including cost considerations and potential public resistance.
The text emphasizes the urgency for policymakers to address these complex questions promptly. Failing to do so risks exacerbating future economic and social upheaval. It underscores the interconnectedness of climate change, housing, and financial stability, urging proactive measures to ensure the sustainability of the housing market and broader societal resilience.
PS - In 2023, I co-edited the book "Adapting the Built Environment for Climate Change: Design Principles for Climate Emergencies" with Emeritus Professor Claes-Goran Granqvist. Currently, I am serving as the lead editor for the second edition of "Cost-Effective Energy Efficient Building Retrofitting: Materials, Technologies, Optimization, and Case Studies."
